Learning More About Your Tax Options
They say nothing in life is certain, but death and taxes and, unfortunately, federal bankruptcy laws live up to that saying by making it harder to discharge tax liabilities than other types of debt.
However, there is some hope that bankruptcy may be able to help you handle tax issues and avoid the worst consequences. To learn more, contact us at Walton Legal Services in Indianapolis or Columbus and make an appointment with a knowledgeable bankruptcy lawyer.
Some Taxes Are Dischargeable in Bankruptcy
Many people believe that taxes cannot be discharged in bankruptcy and that you have to pay your taxes, no matter what. In fact, this is not always true. Income taxes more than three years old can be discharged. In addition, if you are not planning to keep your home, delinquent property taxes can be eliminated.
Income taxes that are more recent, however, cannot be discharged. In addition, if you own a business, sales and payroll withholding taxes must also be paid.
If you fall far behind on your taxes, the IRS or other authorities can place a tax lien on your home or bank account. They can also levy your income, taking more than a normal creditor would be allowed to garnish.
You owe it to yourself to look into whether bankruptcy would help you reduce the burden of tax liabilities. Contact us to talk to an experienced bankruptcy attorney about your options.
Chapter 13 Has Added Benefits
While many taxes are not dischargeable under any type of federal bankruptcy, the Chapter 13 payment plan procedure can help you with certain tax issues, allowing you to pay back property taxes and back income taxes usually without paying interest.
If you are in danger of having a tax lien placed on your home or bank account, filing for Chapter 13 bankruptcy may stop this process from moving forward.
